EL AL reports increased revenue by 37% over 2023; $54m. in annual net profit for 2024

TEL AVIV – Despite the COVID-19 pandemic and challenges presented by the Swords Of Iron War, EL AL has worked tirelessly to meet global aviation shortages and unprecedented demand to continue serving as the air bridge between Israel and the world.

Since the COVID-19 pandemic, the global aviation market has faced significant challenges including a shortage of aircraft engines; spare parts, and delays in the logistics supply chain. The war in Israel exacerbated the shortage of seats and increased demand relative to the limited supply due to ongoing flight cancellations by foreign companies in 2024 given the changing and challenging security realities. The market climate forced EL AL to deal with unprecedented demand for services.

Due to the complex situation, EL AL pursued a strict pricing policy throughout the war, which included, among other things, establishing set fares for several key routes, along with implementing fare caps for other EL AL destinations in economy class. These measures moderated price increases, limiting the average price per passenger (RRPK) increase to 14% compared to 2023.

Key points to consider:

• There is a 14% increase in the average price per passenger (RRPK) compared to 2023, even at a lower rate in economy class.
• Throughout the year, the company offered significant benefits to IDF service members, in both active and reserve duty, including distributing approximately 20,000 free airline tickets, distributing approximately 1.9 billion frequent flyer points, and providing free baggage and seat benefits and a full refund in the event of a cancellation. These benefits were offered to service members alongside the company’s support of the Hostages and Missing Families Forum and to bereaved families.
• The company set fare caps for other EL AL destinations in economy class. These prices were valid from mid-2024 and are still in effect today.
• The company continues to reinforce its flight schedule to increase the supply of seats and to respond to high demand. In 2024, EL AL changed its list of destinations based on market demand, the company’s needs, and the security authorities’ guidelines. EL AL increased frequencies to North America, Europe, and the Far East, while suspending other route operations.

Main financial results for 2024:

• Annual revenues amounted to approximately $3.4 billion, an increase of approximately 37% compared to 2023.
• EBITDAR in 2024 amounted to approximately $1.1 billion, doubling 2023 numbers.
• Annual net profit amounted to approximately $545 million, 4.7 times as much versus 2023.

The company’s equity as of December 31, 2024, amounted to approximately $527 million, compared to a deficit of approximately $209 million as of December 31, 2023. The increase and transition to positive equity stems from the net profit recorded during the year, capital raising in the amount of approximately $135 million, and the exercise of warrants totaling approximately $58 million. Gross financial debt as of December 31, 2024, amounted to approximately $1,519 million. Net financial debt as of December 31, 2024, amounted to approximately $75 million.

Dina Ben Tal Genancia, CEO of EL AL: “The year 2024 presented us with complex national and business challenges, but we have proven our ability to successfully deal with them. Despite the challenges, we managed to maintain the air bridge between Israel and the world during a period of multi-front war, while continuing to implement the strategic plan. These successes would not have been made possible without the commitment of all dedicated EL AL employees, who throughout the entire period have been working day and night to enable the company’s functional continuity. EL AL operated throughout the war with a strict pricing policy, while setting maximum prices and fixing uniform prices for a number of destinations. These actions have been proven successful and it can be seen that in 2024 there is a moderate increase of only 14% in the average price per passenger, compared to 2023. Our goal is to continue to maintain financial stability and bring about growth for the company in all areas. We will continue to adhere to the implementation of the strategic plan, which we are updating and extending today, in order to bring EL AL to global success in all areas of tourism and aviation, with an emphasis on the European and American markets. We welcome the return of foreign companies and continue to establish EL AL’s position as a strong and leading Israeli airline, contributing to the country’s economy and society in Israel. We will continue to work to allow our passengers to trust us so we will always be there at the right moment”.

Yacov Shahar, EL AL’s CFO said: “We are concluding another quarter and another year of growth, resulting, among other things, from an increase in activity volumes and high load rates, alongside careful management of the route network and maintaining the efficiency plan. From the beginning of 2024, we have significantly strengthened the company’s financial profile, improved liquidity, and dramatically reduced the balance of net financial debt, which amounts only to approximately $75 million. This is a record year for EL AL, which is facing the implementation of a large-scale acquisition plan and will still maintain a low debt level so that the debt-to-EBITDA ratio will be less than 3. We expect the Company to cross the $4 billion mark in revenues in 2030.”

Details of the results for 2024 and the fourth quarter of 2024

The company’s annual revenues amounted to approximately $3.4 billion, a growth of approximately 37% compared to 2023, and revenues in the quarter amounted to approximately $851 million, a growth of approximately 26% compared to approximately $678 million in the corresponding quarter last year.

The supply of weighted seat per kilometers (ASK) in 2024 increased by approximately 12% compared to last year and in the fourth quarter, it increased by approximately 9% compared to the corresponding quarter with the continued expansion of the company’s capabilities to reinforce the flight schedule as much as possible and enable an air bridge between Israel and the world. The expansion of production capacity after the end of the COVID crisis, and the addition of aircraft leased under wet lease to the Company’s service activity, allowed the significant increase in ASK.

The revenue per weighted seat per kilometer (RASK) in 2024 increased by approximately 24% compared to last year mainly due to a significant and exceptional increase in the load factor (LF) which jumped to approximately 94% compared to approximately 86% in 2023, as well as an increase in revenue per passenger per kilometer (RRPK) which increased by approximately 14% compared to 2023. The RASK in the fourth quarter increased by approximately 21% compared to the corresponding quarter last year, here too due to a significant increase in the load factor (LF), which jumped to approximately 96% compared to approximately 84% in the corresponding quarter last year, as well as an increase in revenue per passenger per kilometer (RRPK), which increased by approximately 6% compared to the corresponding quarter last year. The increase stems, among other things, from a change in the ticket mix, an increase in demand for luxury classes, a change in the
destination mix, and a focus on central destinations, along with exceptional load rates and increased demand for flights.

The annual EBITDAR amounted to approximately $1.1 billion, 2 times as much compared to 2023, while in the quarter it amounted to approximately $275 million, an increase of approximately 71% compared to the corresponding quarter last year.

The financing item was positively affected as a result of an increase in interest income from deposits due to the significant increase in the company’s liquidity and accordingly, the group’s net financing expenses decreased in 2024 by approximately $47 million compared to last year. Net financing expenses in the quarter amounted to approximately $28 million, compared to approximately $44 million in the corresponding quarter last year. The decrease is mainly due to an increase in interest income from deposits due to the significant increase in the group’s liquidity balances and a decrease in the scope of financial debt.

Net income in 2024 amounted to approximately $545 million compared to approximately $117 million in 2023, a 4.7-fold increase. Net income in the quarter amounted to approximately $130 million, compared to approximately $40 million in the corresponding quarter last year, a 3.3-fold increase. The increase in income is due to an increase in the supply of weighted seat kilometers (ASK), an increase in the load factor (LF), an increase in revenue per weighted seat per kilometer (RASK), significant efficiencies after the COVID pandemic, the focus of EL AL’s route network, and the diversion of aircraft from low-demand destinations in favor of highly sought-after destinations, an increase in cargo revenue and an improvement in the group’s financing expenses.

The company’s cash flow from operating activities in 2024 amounted to approximately $1.4 billion compared to approximately $453 million in 2023. The company’s cash flow from operating activities in the fourth quarter amounted to approximately $355 million compared to approximately $172 million in the corresponding quarter last year. The increase is due to an increase in profitability and an improvement in the company’s working capital, which is mainly affected by the advance sale of airline tickets for demand seasons.

In addition, given the challenges in the aviation market, EL AL is updating its long-term strategic plan, extending it until 2030. The update includes adjusting the rate of aircraft fleet expansion per the expected supply rate, optimizing the route network, developing comprehensive tourism services and integrating them into the customer journey, and maintaining excellence in MRO (maintenance, repair, and overhaul) services for other companies, and examining the global expansion of new products and services including credit, insurance and retail and positive cash flows for exploring investment opportunities.

The main quantitative goals as set out in the strategic plan for 2030:

1. Revenue turnover of more than $4 billion.
2. Market share of 25% from Ben-Gurion Airport reaching approximately 7.6 million passengers.
3. 8-10% of revenues from ancillary and non-aviation activities.
4. Reaching and exceeding a total of 4 million Matmid frequent flyer club members.

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